First and foremost, I hope you are staying safe, healthy, and doing your part to socially distance and flatten the curve. These times are uncertain and unprecedented. I wanted to address some concerns buyers and sellers may have, as well as fellow Realtors.
This is a quick update in the midst of the COVID-19 pandemic that we're experiencing. How is this crisis impacting the real estate market here in London, Ontario?
What might we be able to expect going into the days and weeks ahead?
I think one of the key things that we're seeing is some confusion not only from the public, but also from realtors. Realtors don't really know exactly what to expect. We've had such an active market here at the beginning of the year and it's been such a dominant sellers market that we kind of know the lay of the land. But now, all of a sudden, with this pandemic that we're seeing, we're beginning to see the possibility of the economy kind of come to a screeching halt, at least for a short period of time. We don't know exactly what to do.
What we do see right here on a day to day basis, is we still see that there is a ton of demand in the market. For the properties that are listing, they're still selling in multiple offers. I look at the MLS and there's still tons of realtors that are listing properties. And when I talk to the staff at our office who are processing the deals on the back end of things, they are still telling me that there are a lot of deals that are coming across their desk and it's like nothing has changed.
So will it change here in the days and weeks ahead? I expect that it will.
For sellers, I think there's still a window of time where you can get your property on the market and get it sold. There's certainly policies that we have to follow. For example, we are not doing open houses, we will do a virtual open house. And even with private showings, there are processes that need to be gone through. No doubt, I think there's a pool of buyers that were on the market that have just taken themselves out for now; they aren't comfortable going into other people's homes, and there are certainly sellers that are not willing to put their properties on the market. For me, that is completely understandable. As far as the opportunity goes, I still think it's there, but I think that may end in the near future. If you are considering putting your property on the market right now, I think you can still get away with it. There's certainly enough demand there.
“What do I do if I've bought a house, or I'm in the process of buying a house and there's a possibility that the economy is gonna see a pull-back?”
I think that when you ask yourself that question, a lot of it has to do with your employment. I certainly have some buyers that are kind of in the manufacturing side of things, and that seems a lot more uncertain right now, versus someone that might be working for a government organization such as at LHSC or for the University, or something with a bit more job security. There's some differences there and that is certainly impacting the buyers that are buying, and they can move forward with confidence if they have that stable job. If things seem a bit uncertain, then it's certainly creating some pause for them there. If we begin to see layoffs, especially if it goes for any extended period of time beyond a month, then I think that we will begin to see some pull-back in the market. I just don't know how long that's going to happen.
My prediction is that we will see a blip in the market for about a month or so, and then I think things will pick back up basically to where they are, and maybe even stronger given that people kind of held off for a while, even though that demand is really still there.
People still really want to move, and our inventory is still very low.
In fact it may even be lower when we hit the other side of this. The one piece that I do want to mention here is that the government is doing a lot to make sure that the economy does not see a big pull-back. The bank in Canada has decreased it's overnight lending rate twice; we've seen lenders decrease their interest rates on their mortgage and any sort of borrowing that they are doing. And now, just basically in the last day or two, we've seen the government come out and say “Listen, if there is a pull-back or there are layoffs then we are going to be subsidizing people's mortgages to say if you need it for a short period of time, whether that's deferring payments or capitalizing the interest on the mortgages, we can do that for a short period of time, up to six months.” I don't know the exact details of that yet, and it certainly shows the government's desire to help people not only through this situation, but also to make sure that the economy continues to roll the way that it needs to, and not to let this completely disrupt our economy and send us into a recession.
It's really just a disruption to the real estate market here in London and the surrounding communities.
Until we completely know what the lay of the land looks like, it makes it very difficult to say exactly what's going to be happening. I will try to give more updates like this as things unfold. If you have any questions, I would love to answer them if I can. If you have any thoughts on this, I would love to hear them. If you're a Realtor that disagrees with me, I would love to hear those thoughts as well.
I hope that you're doing your part to socially distance yourself, to hopefully flatten that curve if we can still do that here. And I hope you're staying safe, and reaching out to those that are in your community, maybe not directly, but over technology and social media just like this. The more we stay connected and encourage each other, the less scary it seems, and the less fearful we need to be. We've certainly gotten through harder things in the past and no doubt, we can get through this together as well. Hopefully we can connect soon, take care.